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Britain Diminished, Advantage India

The UK's current challenges present an opportunity for India to deepen an already profound relationship with a natural strategic and business partner. Mr Modi should reach out now to a friend in need of friends

Photo Credit : Reuters

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Britain appears to have become an eager disciple of the Hillary Clinton school of politics: the art of dissipating a strong position.  While the UK is reeling from the inconclusive General Election on 8th June, and about to open Brexit negotiations with the European Union (EU), there is a clear opportunity for India to relaunch its relationship with a key ally to its own advantage.

Prime Minister Theresa May called the General Election three years early because she was tempted by her 20% lead in the opinion polls.  She presented this political gambit as a move to strengthen her negotiating position going into the massively complex Brexit negotiations that are set to start on 19th June.  

The gamble backfired horribly for her.  The result of the election is a hung Parliament.  The Tories are down 13 seats on their slim majority from 2015 and, at 318 MPs, are 8 short of a majority in the House of Commons.  To continue in Number 10, Mrs May will need to rely on support from the small Democratic Unionist Party, which will only come at a price.  Mrs May is now vulnerable to a leadership challenge within her Conservative Party.

The only positive gleam for the Tories was the revival in Scotland, where the party is now second to the ruling Scottish Nationalist Party.  The Conservatives gained 12 seats, up from only one in 2015.  This reduces the likelihood of an early second Scottish independence referendum.

The collapse of the Tory lead during the election campaign was quite unprecedented.  Mrs May's campaign was wooden, accident-prone and ineffective.  In contrast, Jeremy Corbyn, much reviled in his two years as leader of the Labour Party, managed an engaging campaign that energized both his core support and young people.

Mrs May initially presented the election as about Brexit, but this existential issue then fell off the agenda as other, domestic issues like security and social care dominated the debate.  Nevertheless, the surge in Labour support in London and among the young suggests that many on the Remain side of the EU debate remain unreconciled to a complete break from the EU.

The UK gave notice of its intent to leave the EU in March this year and, under the Lisbon Treaty, there is now a two-year period in which to agree the terms of the divorce.  This is a massive challenge after more than 40 years of integration with Europe.  The election result will not help Mrs May's team as they open discussions with their European partners who already have little incentive to be flexible and accommodating towards the UK's demands.  A good outcome for the UK might therefore be a transitional deal to allow more time to put in place a new partnership, including a full free trade agreement and a myriad of other issues from aviation rights to drug licensing.

The hung Parliament, and the damage to Mrs May's political stature, might also embolden those in her Party who still seek to retain some of the benefits of EU membership, most particularly access to the EU Single Market.  To achieve that would require compromise of some of Mrs May's red lines over freedom of movement and the powers of the European Court of Justice.

Brexit in some form remains a racing certainty.  As such, the UK now needs to rethink its place in the world.  There has been much talk of negotiating new free trade agreements with the US and the Commonwealth countries.  India is a high priority and UK ministers have repeatedly spoken of a new special relationship.  The British Government is yet to offer India anything compelling in this much-touted fresh strategic partnership.  Moreover, the insidious politics of immigration continue to poison the dialogue as the UK tightens visa controls, including (most bizarrely) for Indian students wanting to attend UK universities.

There is huge potential to deepen bonds between India and the UK, but that would require boldness, openness and generosity, principally from the British side.  The UK is already easily the largest foreign investor in India on a cumulative basis.  The UK should put together a compelling package of initiatives that play to India's needs and the priorities of the Modi Government.  This would include a much deeper and imaginative deployment of the UK's competitive edge in finance (including financing India's infrastructure build-out), education and research, and defence industries.  

To engage positively with India, the UK will need to adopt a much more welcoming attitude towards visas for Indian visitors, students and entrepreneurs who chose to make the UK their home.

The UK's current challenges present an opportunity for India to deepen an already profound relationship with a natural strategic and business partner.  Mr Modi should reach out now to a friend in need of friends.

Disclaimer: The views expressed in the article above are those of the authors' and do not necessarily represent or reflect the views of this publishing house. Unless otherwise noted, the author is writing in his/her personal capacity. They are not intended and should not be thought to represent official ideas, attitudes, or policies of any agency or institution.


Alan Rosling

The author is an entrepreneur and strategic adviser. He co-founded Kiran Energy and was earlier an Executive Director of Tata Sons. He was a Special Advisor to the British Prime Minister during 1991-93. He now lives in Hong Kong but is frequently in India. He is the author of Boom Country? the New Wave of Indian Enterprise.

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